A writer must “know and have an ever-present consciousness that this world is a world of fools and rogues… tormented with envy, consumed with vanity; selfish, false, cruel, cursed with illusions… He should free himself of all doctrines, theories, etiquettes, politics…” —Ambrose Bierce (1842-1914?). “The nobility of the writer's occupation lies in resisting oppression, thus in accepting isolation” —Albert Camus (1913-1960). “What are you gonna do” —Bertha Brown (1895-1987).

Wednesday, July 29, 2015

“When officers of the Illinois teachers’ pension system
opted to put more than $1 billion under the control of a single financial firm,
Grosvenor Capital Management, they touted the arrangement as a step toward
greater efficiency: Grosvenor would be entrusted to manage a larger slice of
the state’s hedge fund investments, a part of the portfolio that had
previously been managed by a competing firm.

“But the deal, blessed by Illinois pension officials in late 2013, was
distinguished by more than the simple consolidation of two managers into one.
Grosvenor is run by Democratic Party financier Michael Sacks, a major campaign
contributor to Chicago Mayor Rahm Emanuel and a prodigious fundraiser for
President Barack Obama.

“The decision to retain Grosvenor and transfer more state
pension funds to the firm was ratified by a board composed of officials
appointed by then-Illinois Gov. Pat Quinn, a Democrat who had been the
beneficiary of substantial campaign contributions from a political action committee,
or PAC, that was partially run and financed by Sacks’ wife, Cari Sacks. Though
Michael and Cari Sacks had since 1990 contributed to the Personal PAC,
which finances candidates who favor abortion rights, the couple’s contributions
more than quadrupled during Quinn’s tenure in office compared to the previous
decade.

“In short, as the Sackses escalated their giving to a PAC
that supported Quinn, his appointees signed off on shifting hundreds of
millions of dollars to a financial management company run by none other than
Michael Sacks. That decision was made even as Grosvenor was underperforming
less expensive stock index funds. The pension system paid Grosvenor at least
$3.2 million in fees in the year after the deal, state records indicate.

“This all unfolded despite federal rules designed to prevent campaign
contributions from influencing how governments manage their money. The
so-called pay-to-play rules explicitly bar financial executives who manage
pension money from making campaign contributions to public officials who have
authority over pension investments.

“Unlike Illinois’ own anti-corruption statute, the
federal rules include so-called anti-circumvention provisions that seek to
prevent end-runs around the law: Executives who are considered ‘covered
associates’ under the rule cannot funnel campaign contributions through family
members. Third-party groups such as PACs also cannot be used as conduits.

“International Business Times described the
outlines of the deal to Greg Nowak, an attorney at Pepper Hamilton, a
Philadelphia law firm that counsels corporations on compliance with financial
regulations. ‘It raises the perception that the covered associate is attempting
to circumvent the SEC's pay-to-play rule,’ he said, referring to the federal
Securities and Exchange Commission. He added: ‘I would advise against campaign
contributions of this type’…

“The Illinois Campaign for Political Reform’s David
Melton said the mix of political influence, money and pension investments
spotlights a wider problem in Illinois. ‘This appears to be another unfortunate
example of the corrupting influence of big money and unlimited contributions in
the politics of our state,’ he told IB Times.

“‘Pay-to-play’ should not be the basis for awarding state
contracts.”

For entire article, Democratic Party
Financier Got Big Illinois Pension Deal after PAC Contributions by Matthew
Cunningham-Cook, David Sirota and Andrew Perez from International Business Times, click here.

3 comments:

Ask Blagojevich to save a cell for Quinn. The party is through with him, so they will throw him under the bus. Quinn famously said that he had been "put on God's earth" to cut our pensions. Little did we realize that the piece of "God's earth" is a prison cell. (Oh, please, dear God, let Quinn be jailed. Amen.)

Teacher/Poet/Musician

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Persona

"I want everything to be explained to me or nothing. And reason is impotent when it hears this cry from the heart. The mind aroused by this insistence seeks and finds nothing but contradiction and nonsense" —Albert Camus (1913-1960).